AUSTIN, Texas–Credit unions have been told for years that to successful the member experience must be “friction-free.” But one bank is going in the opposite direction by promoting greater friction as a means of being more secure.
With sophisticated fraud growing, increasingly as the result of AI, Austin Capital Bank is betting, through its fintech subsidiary Fort Knox, that some consumers will choose security over convenience.
“The account stands out for the simple fact that pulling money out of it isn’t particularly easy or fast,” noted Newsweek in its analysis.
That’s no accident, according to Austin Capital Bank Founder and CEO Erik Beguin.
‘Shouldn’t Be Easy’
“It shouldn’t be easy to access your savings on a whim,” Beguin told Newsweek. “It shouldn’t be easy to wire your life savings to eastern Europe or Africa or southeast Asia. We have intentional friction, and we’re going to be very upfront about the intentional friction.”
According to the report, Fort Knox aims to protect customers’ savings from fraudsters by combining multiple layers of security. There are no passwords, account numbers or debit cards to steal, and customers can’t transfer money to anyone else.
What happens if a customer wants to move money into another checking account? They will have to wait two business days to “think about it,” according to the report.
“And those are just the most basic security measures. Customers can choose to add additional layers of security to their accounts,” Newsweek added.
About the High-Security Savings Account
Fort Knox Bank says its savings account is intended to serve solely as a vault for funds the customer does not need immediate access to.
“It doesn’t function like a checking account. In fact, you must have a separate checking account at another bank in order to open a Fort Knox account,” Newsweek reported. “Your Fort Knox account must be linked to a bank’s checking account under your name. Your money can only flow to and from this checking account. You can’t send a Zelle payment or a wire transfer f rom your savings account, and you can’t access your funds at an ATM or make transactions with a debit card.”
Beguin told Newsweek the account is designed to protect people from being deceived into authorizing a transfer of funds or withdrawing cash and then depositing it into another account.
Shouldn’t Be a ‘Truck Stop on the Interstate’
“Every other bank account is a truck stop on the interstate highway,” Beguin told Newsweek. “We are a one-way street with a bank, with a vault, with safe deposit box in that vault, and all you can do is put money in and take money out.”
Institutions, Apps ‘Blacklisted’
In addition, to add further protection, Fort Knox has “blacklisted” institutions or payment apps that may pose a greater threat of fraud or that are popular with fraudsters, according to Newsweek.
If Fort Knox detects a security risk to your linked checking account, Beguin told the publication it enables an automatic “lockdown” feature that freezes your account.
How to Get Access
Fort Knox Bak bank doesn’t use standard log-in credentials such as user names and passwords.
“To sign in, you’ll open the app on your phone and it will use facial recognition technology to verify your identity,” Newsweek reported. “Customers have the option to add further layers of security, such as tokens.”
The Fort Knox savings account pays a tiered interest rate of up to 4.07% APY. Accounts with average monthly balances below $1,000 will incur a $10 monthly security fee. The fee is waived for balances of $1,000 or more. An initial deposit of $100 is required to open an account.